SUGANCHAND KANHAIYALAL RATHI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a reference under Section 66 (1) of the Indian Income-tax Act made by the Income-tax Appellate Tribunal, Bombay, referring a question of law for the determination of this Court. The question of law suggested by the Tribunal is as follows:

(2.) THE facts of the case are as follows : THE assessee, Suganchand Kanhaiyalal Rathi of Jabalpur, is a Hindu undivided family, and admittedly it has business at various places, including Ganganagar in the former Bikaner State. THE matter relates to the assessment for the year 1948-49, and a notice under Section 22 (4) of the Indian Income-tax Act was served upon the assessee. He produced his books of account from Ganganagar. THE Income-tax Officer, after holding that the account books of Ganganagar had been suppressed, assessed the tax under Section 23 (4) of the Act on a best judgment assessment. THE assessee had stated before the Income-tax Officer that no separate books were maintained at Ganganagar.

(3.) SECTION 27 of the Indian Income-tax Act provides for a de novo inquiry on certain allegations being made by an application. The circumstances may give a foundation for an appeal if the matter is decided against the assessee; but SECTION 27 itself does not cover a case in which books of account are held to be in existence, when the assessee says that they are not. We quote SECTION 27 :